Correlation Between Arrow Managed and Nationwide Growth
Can any of the company-specific risk be diversified away by investing in both Arrow Managed and Nationwide Growth at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Arrow Managed and Nationwide Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Arrow Managed Futures and Nationwide Growth Fund, you can compare the effects of market volatilities on Arrow Managed and Nationwide Growth and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Arrow Managed with a short position of Nationwide Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Arrow Managed and Nationwide Growth.
Diversification Opportunities for Arrow Managed and Nationwide Growth
0.01 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Arrow and Nationwide is 0.01. Overlapping area represents the amount of risk that can be diversified away by holding Arrow Managed Futures and Nationwide Growth Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Nationwide Growth and Arrow Managed is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Arrow Managed Futures are associated (or correlated) with Nationwide Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Nationwide Growth has no effect on the direction of Arrow Managed i.e., Arrow Managed and Nationwide Growth go up and down completely randomly.
Pair Corralation between Arrow Managed and Nationwide Growth
Assuming the 90 days horizon Arrow Managed Futures is expected to generate 2.16 times more return on investment than Nationwide Growth. However, Arrow Managed is 2.16 times more volatile than Nationwide Growth Fund. It trades about 0.21 of its potential returns per unit of risk. Nationwide Growth Fund is currently generating about 0.11 per unit of risk. If you would invest 546.00 in Arrow Managed Futures on September 14, 2024 and sell it today you would earn a total of 29.00 from holding Arrow Managed Futures or generate 5.31% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Arrow Managed Futures vs. Nationwide Growth Fund
Performance |
| Timeline |
| Arrow Managed Futures |
| Nationwide Growth |
Arrow Managed and Nationwide Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Arrow Managed and Nationwide Growth
The main advantage of trading using opposite Arrow Managed and Nationwide Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Arrow Managed position performs unexpectedly, Nationwide Growth can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Nationwide Growth will offset losses from the drop in Nationwide Growth's long position.| Arrow Managed vs. Money Market Obligations | Arrow Managed vs. Elfun Government Money | Arrow Managed vs. Hewitt Money Market | Arrow Managed vs. Putnam Money Market |
| Nationwide Growth vs. Qs Large Cap | Nationwide Growth vs. Lord Abbett Affiliated | Nationwide Growth vs. Cb Large Cap | Nationwide Growth vs. Dunham Large Cap |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Fundamental Analysis module to view fundamental data based on most recent published financial statements.
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